Casino revenue reports issued from commercial gaming states in recent days suggest play is cooling across the nation.
Empty slot machines inside the Hard Rock Casino Northern Indiana in Gary. Gaming revenue is cooling in some commercial casino states, which could hint at a looming revenue pullback for the industry. (Image: The Times of Northwest Indiana)
After more than a year of robust action, with numerous states reporting unprecedented casino revenue, the latest numbers are beginning to align with Wall Street unease.
After Maryland casinos last week reported that their gross gaming revenue (GGR) was almost 4% lower in September 2022 from September 2021, Detroit’s three properties relayed additional concern.
The Michigan Gaming Control Board said Wednesday that MGM Grand Detroit, MotorCity, and Greektown collectively won $100.8 million in September from their retail slot machines and table games. That’s almost 6% lower year over year.
September marked the fifth consecutive month that Detroit GGR was lower in 2022 than in 2021. But because the beginning of the year benefited from ongoing pent-up demand, 2022 casino revenue through nine months is still slightly higher at $948 million compared with $940 million won during the three quarters in 2021.
Economic Worries
Wall Street indexes continue to tumble, resulting in retirement and investment savings dwindling.
More bad news came Thursday with the US Labor Department reporting that the Consumer Price Index, a broad measure of the average cost of common goods and services, rose an additional 0.4% from August, and climbed 8.2% annually. Both data points exceeded consensus expectations among economists.
Gallup polling shows that most Americans see economic woes as the biggest problem facing the country today. Robert Frick, a corporate economist with Navy Federal Credit Union, said the September Consumer Price Index “virtually guarantees” that the Fed will increase interest rates by another 75 basis points in November, and likely another 50 basis points in December.
Though the country is already amid a recession depending on who you ask and what defining parameters are used, President Joe Biden downplayed the nation’s economic fears during an interview with CNN’s Jake Tapper on Tuesday.
I don’t think there will be a recession,” Biden said. “If it is, it will be a very slight recession. Look, it’s possible. I don’t anticipate it.”
Americans might be anticipating it, however, and that could be the reason for casino gaming revenue beginning to trend south. Nevada will provide more insight when its September casino numbers are released in the coming days.
Some Play Moving Online
Though Detroit casino revenue has lowered from 2021 in the past five months, there’s a bit more to the brick-and-mortar GGR story. Michigan legalized iGaming — online slots and table games — in 2019.
Legal internet casino gambling went live beginning in January 2021. And with gamblers no longer required to travel to downtown Detroit to play a regulated commercial slot machine or table game, it’s believed that some of the former retail play has migrated online.
iGaming has been strong throughout the pandemic and into 2022. September numbers will be reported later this month, but online gambling revenue totaled $130.9 million in August. That was 3.4% better than July and 34% higher than August 2021.
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